OfflineI'm proud to tell all of you (sins the only people who can appreciate what I'm doing) that I contacted a man from an ed in the peper and now I have a contact to whom I can assign my deals these is so exiting had to tell someone. Thanks for reading.
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in order to do that, you will need to have found a MUCH UNDER VALUED property, just make sure that your accurate with the FMV of the property, theirs usually a REASON why the property hasen't SOLD already, just be careful.
YOUR HERO, SULLY
I was hoping to find some really under valued homes and would turn to a realtor only if I could not find another buyer or someone to assign the contract to. If I use the contingency clauses you posted before, that should protect me in the event that I can't find a buyer either way right? Sorry if these sound like stupid questions, I just want to make educated decisions!
Also, could someone explain to me the math involved in the assigment process? What would be considered a good difference between the purchase price and FMV? Also, what kinds of costs will I incur during assignment and can I structure the contract to avoid those?
I know, lots of questions! I like to learn!
-Adam
Investors are looking to buy at a price of less than 70% of the ARV (After Repair Value) So you would have to pay less than this to include your profit for the assignment. That is wholesaling. OR if you can find a buyer that is willing to pay more (retail), then you have a bigger margin to put in your assignment fee. In either case you would first sign a purchase agreement with the seller (signing your name, or your LLC's name, PLUS and/or assigns, locking up the deal for yourself). Then do an assignment contract with your investor or end buyer, http://www.deangraziosi.com/documents/Assignment-of-Contract.pdf , thereby selling the contract (to purchase the property) for the amount that you set for an assignment fee. Your buyer would then follow through with the deal in place of you.
When you do an assignment there shouldn't be any cost to you, except the earnest money of as little as $100 that you may have to put down to lock up the deal (which you would get back). All other expenses should be your end buyer's.
Hope that's not too wordy.
Rina
P.S. Sully's right. Make sure all the numbers are right (comps especially) before presenting the deal to your buyer.
"Obstacles can slow you down, but they can only stop you with your permission." Dean Graziosi (BARM pg 101)
"For I know the plans I have for you," declares the Lord, "plans to prosper you and not to harm you, plans to give you hope and a future." Jeremiah 29:11
For a little about me, welcome to the site, and a few tips for new DG family members, click on this link: http://www.deangraziosi.com/user/3249
Theirs a couple of different FORMULAS that I use depending upon the situation. While it took me quite a while to figure these out, i will give you the one i most commonly use, WHOLESALING FORMULA:
ARV x 70% -REPAIRS -C/C/COST -AF = MAO
1) ARV: after repair value
2) REPAIRS: deduct repairs as needed
3) C/C/COST: carrying & closing costs
4) AF: assignment fee
5) MAO: max allowable offer
YOUR HERO, SULLY
I'm trying to get my buyers list together, and when I called this first investor, he wanted the address prior to anything. I didn't give it to him. When that type of issues comes up, what do I do.
Thanks for your advice.
Anne